IRANIAN VISITORS AND DEVELOPERS WORRY BASRAWIS

S E C R E T SECTION 01 OF 02 BAGHDAD 000768

NOFORN
SIPDIS

E.O. 12958: DECL: 03/20/2019
TAGS: PGOV PREL PTER PBTS IZ IR
SUBJECT: IRANIAN VISITORS AND DEVELOPERS WORRY BASRAWIS

REF: A. BAGHDAD 762

B. BAGHDAD 661

C. BASRA 002

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Classified By: Senior Advisor Gordon Gray for reasons 1.4 (b) and (d)

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Summary
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1. (S/NF) One year after militias supported by Iran were
routed in the Charge of the Knights operation, Basra
residents continue to be worried about Iranian influence over
national politics and local security. In separate meetings
with Senior Advisor Gordon Gray, held March 17-18, tribal and
Iraqi intelligence sources claimed that the recent visit to
Najaf by Iranian President Rafsanjani was organized to
pressure Prime Minister Maliki and the Islamic Supreme
Council of Iraq (ISCI) to make amends and re-establish a
united governing coalition. Local security officials see
Iran behind a recent uptick in IEDs in Basra, including
attacks against Coalition Forces. Many also worry about
border security along the Shatt al-Arab waterway and the
effect of Iranian dams on local marshes, which are mostly dry
near the Basra Province-Iran border. Basrawis expressed
wariness that the Basra Investment Commission approved for an
Iranian company a license to build $1.5 billion worth of
houses, stores, and hotels in the city. End summary.

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Suspicious of Rafsanjani
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2. (S/NF) In separate meetings, Colonel Hazim from the Basra
Fusion Cell and two prominent Basrawi sheikhs claimed that
the visit of former President Ali Akbar Rafsanjani in early
March was orchestrated to patch up differences between Prime
Minister Maliki and ISCI. Sheikhs Sabah and Salam Taki
al-Maliki, from the al-Qurnah region north of Basra, said
that the Rafsanjani delegation's visits -- with Grand
Ayatollah Sistani in Najaf; Ayatollah Karbal'ae in Karbala;
President Talabani, Da'wa and ISCI leadership in Baghdad --
were designed to use the Shi'a religious hierarchy to
pressure Maliki to work with ISCI and the Kurds and, by
extension, be more amenable to their positions (ref A). The
sheikhs, who have become strong supporters of the Prime
Minister due to his increasingly nationalist stance vis-a-vis
the Kurds and Iran, sounded relieved that efforts to reunite
ISCI and Da'wa had not been successful. Sabah and Salam did
not specify their sources, but both have strong links to the
Iraqi Army and the Prime Minister's office. The anger
aroused in the sheikhs by the Rafsanjani visit was shared by
many in the Basra area. The local leader of the Sunni
National Dialogue Front and several local Shi'a sheikhs
protested Rafsanjani's visit vigorously in the Basra media,
noting his role in the Iran-Iraq War.


3. (S/NF) Colonel Hazim, a former Iraqi Army officer, also
asserted without prompting that the Rafsanjani visit aimed to
reunite Da'wa and ISCI. He added that Iran has an interest
in seeing the Kurds succeed in its squabbles with the central
government over Kirkuk and Article 140. "Federalism is an
Iranian position," he remarked, suggesting that Iranian soft
support for Kurdish regional objectives in the north is part
of a broader goal of supporting a larger, theoretically
ISCI-governed region in the south. Hazim's view closely
aligns with views expressed by other Iraqi Security Forces
(ISF) officers in Basra, including the Iraqi Army 14th
Division Commander, Major General Abd al-Aziz (ref C). Not
all local leaders agreed with this analysis. ISCI/Badr
leader Hassan al-Rashid told us flatly the Shi'a marja'iyah
would not intervene in ISCI-Da'wa relations, and that the two
sides were not close.

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Getting More Violent
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4. (S/NF) Hazim also provided his view on the recent uptick
in IEDs and rocket attacks in Basra and the south more
generally, which he called "a new phase in the insurgency."
IEDs and their components, he said, are being shipped from
Iran through Amara to Basra. Hazim boasted that his team,
along with the ISF, stopped political assassination attempts
during the election season and had arrested four people in
connection with the latest rocket fired at the Coalition
Operation Base. He believed it would be difficult to stop
militia elements, since the lack of a strong central
organizing force (i.e., Jaysh al-Mahdi circa 2007) means that
cells are broken into groups of only a few people and are
hard to track. Hazim suggested that militias are receiving
Iranian funding, including through hashish sales, but also

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said that militia members have increased local funding by
getting their tentacles back into Basra port and related
government agencies.

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Iranian Construction License
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5. (C) Basrawis are also buzzing about the $1.5 billion
license approved in February by the Basra Investment
Commission (BIC) for the Iran company Abb Hayatt and its
subsidiary, Karman. The license, which reportedly would be
Iran's largest in Iraq since 2003, still requires approval
from the National Investment Commission. The license would
authorize construction of 5,000 housing units, hundreds of
stores, three-star and four-star hotels, a supermarket, and
health facilities, among other amenities. The location has
not been determined; Karam has proposed to build both
downtown and on the outskirts of the city. Conflicts over
property rights and land use may slow down final national
approval and construction. To many, such as the al-Qurnah
sheikhs, approving such a large license to an Iranian firm is
cause for alarm, or at least concern. BIC Chairman Haider
Ali, perhaps sensing local unease, decried in local media the
lack of bidders from the UK and other coalition countries.
Many appointees to BIC are ISCI/Badr members; some, including
NDF leader Awad al-Abdan, have told the Regional Embassy
Office that this facilitated the Iranians' bid. ISCI/Badr
Provincial Council (PC) member Hassan al-Rashid did not
discuss the contract specifically, but said that appointments
to the BIC to be made by the new provincial government are a
serious point of contention. He strongly suggested that
keeping ISCI/Badr seats on BIC is a priority for him.

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Water and the Border
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6. (C) Water and security along the Iranian border remain key
issues for Basrawis; all interlocutors, including the
ostensibly pro-Iranian ISCI/Badr leadership, emphasize that
the U.S. must do more to train the ISF to patrol the borders.
The sheikhs, picking up on comments made earlier this month
by Foreign Minister Hoshyar al-Zebari, mentioned that
disagreements over the demarcation of the border along the
Shatt al-Arab waterway were still worrisome. (Our contacts
in Dhi Qar last week made similar claims; ref B.) Several
leaders in southern Iraq also point to dams built by the
Iranians along the Karun River as a prime contributor to the
dry marshlands in the region. Dayaa Jaafar Hajam, a Da'wa PC
member, strong candidate for governor, and Chief of
Operations at Southern Oil Company, acknowledged the serious
bilateral issues that Iraq has with its neighbors with
respect to water. He was confident that the Iraqi government
had recently reached an understanding with Turkey that would
increase water flows to the marshes and believed that Syria
could be convinced to build fewer dams on the Euphrates in
return for cheaper crude oil. Regarding Iran, Dayaa could
see no immediate solutions and commented, "I only hope the
issue doesn't spill into other areas."
BUTENIS